Browse Tag: shopping

Are you an impulsive buyer?

Do you often drag yourself into impulsive buying?

 

“An impulse purchase or impulse buying is an unplanned decision to buy a product or service, made just before a purchase.One who tends to make such purchases is referred to as an impulse purchaser or impulse buyer. Research findings suggest that emotions and feelings play a decisive role in purchasing, triggered by seeing the product or upon exposure to a well crafted promotional message.”

impulsive-purchase

 

In your day to day life, knowingly or unknowingly you go through instances where you succumb yourself to the lure of impulsive buying. The product companies are out there in every shop, every mall, every online marketplace – blaring adverts, offers, packaged deals to you. We have seen earlier that Supermarkets do extensive research on how to push their products and how to compel buyers to spend more in their stores.


Can you give me some example so that I can relate whether I am buying stuff impulsively? As far as I know i am not into impulsive buying

  • When you go to supermarket to buy monthly grocery, you pick up few ready to eat meals as they are packaged beautifully and kept in the front area of supermarket. They always have “buy one get one free” offer

  • You go to shopping mall to purchase refrigerator and you end up buying that 75inch LED TV also just because there was an offer going on that. You , being a sincere shopper, got charged emotionally and purchased the big TV just because your conscious felt that you are saving substantially on this purchase. You didn’t even give a  thought to what you will do with the TV set adorning your living room which you bought last year in similar fashion

  • How many times you have noticed that you enter mall for grocery shopping with a budget of INR5000 and end up spending INR 1500 on grocery + “something else” which had a GREAT offer?

 

Yeah that’s OK, but sometime you need to grab the offer that is going on else you will miss the boat and God knows when such offer will return?

A seasoned impulsive buyer always suffer with FOMO – Fear of missing out. If you add up all impulsive MISCELLANEOUS purchase over a period of time, you will be shocked to know the amount you have spent on these purchases.

 

Below I am listing few reasons – why people shop impulsively

 

  • Love of shopping – some people simply love shopping. For them shopping is like a therapy. They are always under illusion that few items here and there won’t disturb their bank balance.
  • Some shoppers are always in loss aversion mode. They fear that if they do not buy certain items which are on sale, they might end up at losing a big amount of money.
  • Some shoppers succumb themselves to twisted offer phrases. “Buy 2 get third free” , “buy this and get that free” etc. The moment they see these offers, they succumb to it without further researching about the product, service, and quality.
  • Some shoppers have genuine desire to save more. They succumb to the offers on supermarkets which says “you save INR100” , “Buy & save INR1000”. In order to feel good , they buy these items.
  • Some shoppers always feel that they should have an edge over others when it comes to latest gadgets, latest fashion , latest automobiles. They always pick up items which they feel will make them look cool among their social network.

 

 

Hmm.. Sounds right. I never knew impulsive shopping is such a bad habit and I must admit that I myself must have lost a fortune by now through impulsive shopping.

Yes, impulsive buying is harmful. By the time one realise this, he/she would have lost a huge fortune on it. This could hamper your financial planning, your early retirement, your retirement plan and can pose a big threat to your financial independence planning.

Below I am keying in few important actions through which we can avoid impulsive purchase

 

  • Always make a shopping list when you go out for shopping – AND “Stick to it”
  • Follow a mandatory waiting period if you plan to buy anything. If you see anything which you wish to purchase, wait for 7 days and see if after 7 days do you have the same urge to buy that thing? Most of the time the urge is momentary and it dies down soon.
  • If you already owe the item you wish to buy and you intend to replace it, clean it. Now see if you have the same urge? E.g. if you have a pair of shoes and you intend to replace, clean the old pair, wash it / polish it. If you still feel that you should go for the new pair, then go ahead
  • Remember – only fools rush in. All gadgets, the first edition always have some glitches and service issues. Better to wait and go for later releases. They are relatively bug free and cheaper.
  • List down your impulsive purchases – revisit the list periodically so that you do not make the same mistake again
  • Keep decluttering your house often. This will keep you in check of all the items you have and you will not end up buying them again. This is specially applicable for stationary items and tools.
  • Avoid going for shopping with RICH friends or friends who are spendthrift. Believe me, you will save a lot by doing this
  • Don’t save your credit cards at online shopping sites. If you save then it’s a matter of few clicks and online order gets executed.
  • Buy all items cash. Parting with currency notes is much more difficult compared to swiping plastic cards.

 

 

Great. Very practical points. I am sure I can implement these easily in my day to day life and I can save loads of money by doing this.


Yes, the advice given above is quite practical in nature and easy to integrate in your lifestyle. Always remember it’s your own hard earned money. By avoiding impulsive buying you can use your money in much better way.

 

Happy Investing !!!

Supermarkets are a big TRAP

Why Supermarkets are a big TRAP and also big money DRAIN !!!

All the supermarkets are intelligently designed. What item will come where and in which row is meticulously planned. No wonder why the retail chains hire MBA grads for such a higher salary. The planners sit in a plush meeting rooms, peeping at the historical data and planning how to fit certain useless high margin items in front row of the stores.

Supermarket are money drain

 

The layout Trap

The layout of supermarkets are organized in such a way that daily use items are always found at the farthest place from the entrance. Once you enter to buy your supply of bread or milk, you need to wade through the entire store with each shelf literally shouting the offers to you – on useless items. And being a ‘good buyer’ we always end up picking a couple of useless products because of some stupid offers on them.

It is easy to avoid the TRAP

It is not that there is no way to avoid this trap. Impulse buying can be tackled tactfully by visiting these super markets with a written buying list of items you intend to buy. And you must stick to this ‘buying list’. The buying list is something that requires a little bit of effort from your end to make. This is in order to keep your list as efficient as possible.

Do keep the following points in mind for preparing an efficient buying list.

  • Plan main grocery shopping trip only once or twice in a month. This applies to the items like flour, pulses, rice, cooking oil, spices, supplies like sugar, tea powder, coffee powder, cheese, sauces etc. Estimate the quantity you would require of these supplies and enter them in your beginning of the month main shopping list. At the most when you enter the super market, you can strictly look at the offers on the items in this list and weigh them by arriving at per unit cost of item – with discount and without discount. Take whichever is the cheapest BUT the price point – with discount should justify the quantity you are buying. Use common sense; do not buy 25 Kilograms of sugar just because you get 10% discount on buying 25 kilograms pack when your monthly requirement is only 2 kilograms of sugar.
  • Reserve a weekly visit just to buy the stuff which is perishable and you need their supply often. This is for the products like eggs, milk, paneer, curd, juices, yogurt etc. You cannot stock these items for long at home and they are always better if consumed fresh as they come with a short shelf life. You can include your weekly bread supply too in this list. Go to the supermarket on a weekend, check offers on these products and purchase them. Here again use common sense when you are comparing discounted price with the quantity.
  • Add items from your main shopping list into the weekly list for which you are low on supply. For example, if you have some unexpected visitors at home for a few days, you are sure to go low on the supply of cooking oil, wheat flour, rice, sugar etc. Do not go separately to buy these items on a weekday. This is waste of time, fuel and energy. Instead, add the low stock items in the weekly shopping list and buy them on a weekend. Since weekends always have some discounts running to attract buyers, a chance of you getting a better price is always there.
  • Take review of the stock levels once in 15 days and again add items which are low in quantity in the weekly shopping list. Here again it should not be the case that you have monthly rice consumption of 5 kilograms and in spite of having 10 kilograms in stock you have gone ahead – added the item in the monthly shopping list and bought another 10 kilograms just because there was an offer running on the item.
  • NEVER ever enter any super market for shopping with empty stomach. When you are empty stomach, your hungry stomach guides you through the fast food stuff and compels you to buy stuff like cakes, pastries, ice creams, snack items. Your hunger makes you succumb to buy sandwiches and pizzas thus killing the purpose of entering the super market to buy grocery items and save money by buying your monthly requirements in one visit.

Super stores play mind games with people. Armed with the data and analytics, coupled with brainstorming of grade A pass outs from business schools, they literally direct you on what item to place in your shopping basket. You need to be a little smart and systematic to dodge the useless offers thrown at you when you enter a super market and only buy the items you need to buy.

A visit to the supermarket for grocery shopping could turn a big money drain and destabilize your budget for the month if not planned carefully. Over a period of time, these visits have potential to derail your financial planning and can make a big dent in your wealth creation plans.